UK/US - Govett Investments is urging schemes to increase their US equity allocations.
The fund manager is confident that the US economy will avoid entering a double-dip recession.
It said that while geopolitical and economic problems had not yet been solved, the “constant worry and anxiety” stemming from world events would lessen and consumer confidence would improve.
Govett points out that personal income in the US has been rising steadily to help sustain consumer spending.
Govett fund manager Gil Knight said: “As war clouds fade, some uncertainty and anxiety for business executives and investors should be removed.
“This end to hostilities should allow consumer and business capital spending to accelerate.
“We are optimistic regarding market progress over the next quarter and gladly note that GDP growth rate is projected to be around 3-3.5% for the full year. We expect US shares to improve accordingly.”
He pointed out that 2004 was a presidential election year which, historically, were good years for equity markets.
Britannic Asset Management head of US equities Alison Wright said that while the US market was attractive from a valuations perspective, “a sustained recovery in the equity market will only occur alongside a slow recovery in earnings growth”.
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